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Log In / Register | May 22, 2018

2012 Hotel Forecast: Recovery Better For Some, Not All

PKF-HR forecasts that rooms revenue (RevPAR) for U.S. hotels will rise 8.1 percent in 2011, and increase another 6.1 percent in 2012. Analyzing the performance of U.S. hotels in 2010 and 2011, we have seen the progression of indicators that one would expect during an industry recovery.

Lodging Asset Values in Recovery

Despite inconsistent economic news, increases in lodging demand and property-level net operating income (NOI) have most industry participants feeling optimistic that hotel property values are heading upward.

2010 Was A Budget Beater for Hotels

After suffering through record-breaking declines in revenues and profits during 2009, it is not surprising that U.S. hoteliers were a bit conservative when preparing their operating budgets for 2010.

Hotel Operators Control Utility Costs

After two years of declining revenues and profits, U.S. hotels turned the corner in 2010. According to the 2011 edition of Trends in the Hotel Industry published by PKF Hospitality Research (PKR-HR), the average hotel in the nation achieved a 4.8 percent increase in total revenue during 2010.

Price Begets Profits

In the March 2011 edition of our monthly Hospitality Market Update newsletter, PKF Hospitality Research (PKF-HR) made the following observation: "The driving force behind revenue growth in 2011 is clearly price positioning. The higher the room rate the greater the projected growth in ADR and, consequently, RevPAR."

One Night Stands Are Expensive

On paper, the formula for success at an extended-stay hotel is very sound. By accommodating guests for an extended period of time, these properties are able to "cover up" the soft spots on their calendars and achieve extraordinary annual levels of occupancy.

Locals Up, Lounges Down

In past articles, PKF Hospitality Research (PKF-HR) has labeled the period 2000 to 2010 as the "lost decade" for the U.S. lodging industry. During this volatile period, hotel revenues remained virtually flat through two major recessions and one extended period of prosperity.

Taxes and the Deficit

It was quite a year for health care reform, tax legislation, change in control of the House and the rise of the tea party in 2010. Oh yes, it was a very political and partisan year.

Hotel Freebies Grow

If guests are going to criticize hotels for "nickel and diming" them by charging resort fees and surcharges, then they should also be aware of the services and amenities that U.S. hotels provide on a complimentary basis.

Hang Up the Phone, Hold the Starch, But Please Park My Car

The first ten years of the 21st century could be characterized as the lost decade for the U.S. lodging industry. From 2000 to 2009, the average hotel that participated in the annual Colliers PKF Hospitality Research (PKF-HR) Trends in the Hotel Industry survey experienced a negative 1.0 percent compound annual change in total revenue.